A buy-before-you-sell program provides a bridge loan, backed by the value of your existing home, to allow you to make a firm offer on your new dream home before selling your current one. Most of these programs also have a backup plan if your existing home doesn’t sell within a set timeframe.

It’s a Cash-Backed Offer

The real estate home light of needing to buy a new home before selling your current one can be frustrating. However, several buy-before-you-sell companies help homeowners solve this problem.

These services provide a bridge loan based on your existing home equity to purchase a new property, which can be paid back once your old house sells. Most also offer a backup cash offer, although that feature varies between companies.

Many buy-before-you-sell programs require that you use their affiliated agents or lenders to get a mortgage, though others allow you to compare shop for rates. They charge a service fee to conduct the transaction and a carrying cost for keeping your property until it sells (which varies by company). But these fees are generally lower than those you would pay with a traditional sale or an I Buyer. And they can be less expensive than a double mortgage. That can give you more negotiating power in a seller’s market.

It’s a Streamlined Process

The Buy before You Sell program empowers mortgage loan originators and their real estate agents to work together to improve the home buying experience. By facilitating the purchase of a new home without a contingent sale on an existing property, the program eliminates a key hurdle for homebuyers. It may strengthen real estate agents’ relationships with their clients.

This is especially critical in today’s market, where sellers often ask for few or no contingencies. It also reduces the need for a bridge loan, which may increase monthly payments and impact credit ratings.

Plus, many buy-before-you-sell companies offer a backup cash offer you can accept if your house doesn’t sell within a specified time frame. This eliminates the need for temporary housing and a double move and gives you the confidence to make a competitive offer on a new home. You can even use the advance on your existing home’s equity for home improvements, boosting its sale price.

It’s a Risk-Free Move

The Buy before You Sell program lets homeowners unlock the equity in their current home to use as a down payment on their next property. This effectively turns any offer into a cash-backed offer and eliminates the need for temporary housing between moves.

The program also allows buyers to scour the market for homes that align with their lifestyle and price range without worrying about a pending sale. This enables them to capitalize on competitive properties that would otherwise be unavailable or force them to accept lower offers.

Traditionally, buying before selling involves using bridge loans or tapping into savings to cover the difference. These loans often carry high fees and interest rates and may lead to financial hardship if not managed carefully. With the Buy before You Sell program, homeowners may avoid these pitfalls and potentially ensure their transition is as smooth as possible.

It’s a Smooth Transition

While buying a new home before selling your current one can seem daunting, it’s not impossible. Various innovative financing solutions may help homeowners find their next home without having to sell their existing home first.

One option is to use a bridge loan or invest your savings to buy a new home. However, those options ma6 come with risks and require much time to manage. A buy-before-you-sell company may eliminate the stress and risk of juggling two home purchases by offering a backup offer that helps ensure you can close on your new home if your old house doesn’t sell quickly.

In addition, buying before you sell allows homeowners to take advantage of favorable market conditions. This may include lower mortgage rates and more competitive home prices. Additionally, it may reduce storage costs and eliminate the need to shuffle families around while searching for the right property.

Disclaimer: The information provided in this article is for informational purposes only and should not be considered financial, legal, or real estate advice. Buy-before-you-sell programs vary by provider and may have specific terms, fees, and eligibility requirements. Before making any real estate or financial decisions, consult with a qualified professional to assess your individual situation. The author and publisher are not responsible for any financial outcomes resulting from the use of these programs.

Published by Stephanie M.